Month: April 2019

ICE’s major institutional cryptocurrency trading platform Bakkt has announced the аcquisition of crypto custodian service – the Digital Asset Custody Company (DACC), as reported by the company itself on April 29th.

Former Coinbase executive turned Bakkt COO Adam White, wrote in a blog post Monday that it had acquired DACC with the aim to continue developing a secure digital asset storage solution. No details about how much the acquisition cost have been revealed. Furthermore, the post also stipulates a number of new measures in an effort to stimulate regulatory feedback.

The entire team at DACC will be joining the company, as the team shares Bakkt’s security-first mindset and will bring experience in building its own secure and scalable custody solutions.

White further added that DACC’s native support of 13 blockchains and more than 100 assets will contribute greatly to the scaling of the platform as well as adding support for other cryptocurrencies beyond Bitcoin (BTC).

In the same blog post, it was disclosed that the exchange platform has been working closely with global bank BNY Mellon on developing and establishing a geographically-distributed private key storage, in order to provide more storage solutions to its clients.

On another note, Bakkt has secured as well insurance for funds, which are stored offline.

According to White, the exchange uses both warm (online) and cold (offline) wallet architecture to secure customer funds. Thus, the majority of assets are stored offline “in air-gapped cold wallets that are insured with a $100,000,000 policy underwritten by leading global insurance carriers,” however the COO has offered no names for who these insurance carriers might be.

Meanwhile, the COO has also revealed that the exchange has filed an application with the New York Department of Financial Services (NYDFS) to operate as a trust fund.

If granted, the exchange would be able to offer a regulated custody for any crypto assets that it holds, which may facilitate the launch of physical bitcoin future contract. Respectively, Bakkt stated that the company is seeking to launch physically-delivered BTC futures, with contracts set to be traded on ICE Futures US (IFUS) and cleared on ICE Clear US (ICUS), which is a federally regulated exchange and clearinghouse overseen by the United States Commodity Futures Trading Commission (CFTC).

ICE – operator of 23 major global exchanges, including the New York Stock Exchange (NYSE), had first announced the launch of the Microsoft cloud-powered “open and regulated, global ecosystem for digital assets” Bakkt back in August of 2018. The launch date had been initially set for January 2019, however due to the pending approval from the CFTC, Bakkt postponed the launch to later within the year.

UK’s largest car manufacturer, Jaguar Land Rover, has announced on Monday that it is teaming up with the IOTA Foundation to test a smart contract which will allow drivers to earn digital currencies whilst driving a car in exchange for data sharing.

The car manufacturing leader is designing and developing smart wallet software to be installed in its fleet of cars, which will include the two new models: Jaguar F-PACE and Range Rover Velar. Both car models have already been equipped with the software. However, no official date for the launch has been revealed yet.

The concept itself is rather simple — drivers will drive their vehicles, and gather useful data about road and traffic conditions. For instance, providing information about potholes locations, traffic congestions as well as the performance of the car. The data will then be shared in real time with local authorities or navigation providers, and in exchange, drivers will earn cryptos for their data sharing.

Furthermore, those earned digital currencies can then be used for making various small payments, such as paying tolls, or parking meters, purchasing a cup of coffee, or paying for electricity at charging stations. According to the announcement, this partnership will further contribute to the “zero emissions, zero accidents, and zero congestion” goal.

IOTA Foundation and its blockchain technology have been a go-to solution for numerous carmakers who wished to enter the world of crypto and blockchain. The foundation is known for its Tangle distributed ledger technology designed for the Internet of Things (IoT). The open-source tech specializes in machine-to-machine learning technology for data transfer and micropayments, all of the features that the new Jaguar Land Rover will offer.

It is no wonder that Jaguar Land Rover decided to turn to IOTA and its distributed ledger tech, combined with the smart wallet, as a method of receiving and sending payments. Respectively, there will be no transaction fees and payments will be faster.

Software Architect at Jaguar Land Rover, Russell Vickers strongly believes that this is only a beginning of greater things to come.

“In the future, an autonomous car could drive itself to a charging station, recharge and pay, while its owner could choose to participate in the sharing economy – earning rewards from sharing useful data such as warning other cars of traffic jams.”

Holger Kother of the IOTA Foundation has stated that the company’s distributed ledger technology is perfectly suited for this purpose — to allow machine-to-machine interaction and payments, for things such as parking, smart charging, tolls, as well as creating opportunities for drivers to earn their own digital money.

Based on market cap, IOTA is the #15 cryptocurrency, and the coin shot up nearly 12% following the news. This is good not only for IOTA investors but also for the crypto community as a whole. It suggests that coins are starting to trade on their own positive developments and not only the whims of their larger peer (Bitcoin).

Crypto exchange Bitfinex has allegedly lost $850 million, and in order to cover the shortfall the exchange used funds from affiliated stablecoin operator Tether, according to court files published on April 26th.

NYAG Starts Court Proceedings

The New York Attorney General, Letitia James, has revealed that the court had received court filing alleging that that iFinex Inc. — the operator of Bitfinex — Tether Limited, and their affiliates were in violation of New York law in connection with fraudulent activities, executed without the knowledge New York-based crypto investors.

According to court filings, the exchange hadn’t revealed the loss to investors, with executives of the exchange and Tether engaged in a series of conflicting corporate transactions where Bitfinex got access to up to $900 million of Tether’s cash reserves. Allegedly, Bitfinex took hundreds of millions of dollars Tether’s reserves and subsequently used them to cover up losses as well as its inability to process clients’ withdrawals.

Attorney General James has released a statement that said:

“Our investigation has determined that the operators of the ‘Bitfinex’ trading platform, who also control the ‘tether’ virtual currency, have engaged in a cover-up to hide the apparent loss of $850 million dollars of co-mingled client and corporate funds. New York state has led the way in requiring virtual currency businesses to operate according to the law. And we will continue to stand-up for investors and seek justice on their behalf when misled or cheated by any of these companies.”

Following this statement, the court has ordered that both affiliates immediately cease the dissipation of the US dollars that back tether tokens and to hand over documents for the investigation process. It further adds that both companies are prohibited from destroying potentially related documents.

Bitfinex and Tether Riposte

Meanwhile, Tether’s statement, which was a joint statement with Bitfinex, asserts that the court filings “were written in bad faith and are riddled with false assertions”, claiming that the $850 million were in fact not lost, but seized and safeguarded. It further states that both companies are currently working on getting those funds released.

Respectively, both Tether and Bitfinex insisted on having fully cooperated with prosecutors and called on the Attorney General’s Office to “focus its efforts on trying to aid and support our recovery efforts.”

Tether had previously faced a controversy in January of 2018, when critics of Tether alleged that the crypto, which had claimed to have $1 in reserve for every unit of stablecoin issued, was in reality operating a fractional reserve and issuing more tokens than it had backing for, which were then sent to the Bitfinex exchange. Subsequently, both exchanges faced a subpoena from U.S. regulators and after being ordered to undergo an unofficial audit, it was found that stablecoin had the appropriate amount of backing dollars.

At present, the Attorney General is seeking an injunction to compel Bitfinex and Tether to continue trading, in order not to harm the customers of both entities.

French business magazine Capital reported the news on April 24th, stating that a spokesperson for Ledger had confirmed the investment. However, the representative provided no further details beyond the amount invested into the startup.

The news follows the recent appointment of Pascal Gauthier – the company’s former president – as the new CEO. The previous CEO, Eric Larchevêque, will serve now as Executive Chairman of the Ledger’s Board.

Larchevêque has confirmed the news as well, tweeting out that “we will always need hardware wallets, but to accompany a revolution crypto based on a personal sovereignty accessible to all, the smartphone will actually play a central role.”

At present, the startup is in partnership with several other financial institutions with the goal to establish and offer a number of custody alternatives. For instance, their custody venture with Nomura – a Japanese bank – is expected to launch by 2020. Similarly, Ledger is also working on custody services for Ethereum-based tokens with Hong Kong legacy Trust.

Meanwhile, Samsung has recently broken into the crypto and blockchain industry. Recently, the company announced that a new line of flagship smartphones – the Galaxy S10 series – will come out including new functional features such as a crypto wallet.

In addition to that, Ledger has had previous funding rounds, including a $7 million Series A fund raise in 2017 and a $75 million Series B in 2018. Many speculate this could be part of a larger funding round from Samsung, however it currently remains unclear.

An anonymous source has tipped local news off that Samsung may be working on the development of a public-private blockchain platform as well as its own Ethereum-based token, dubbed the Samsung Coin. The person claimed “we expect Samsung Coin to come out in the market, but the direction has not yet been decided.”

However earlier this week, Samsung has announced the delay of the official launch of its $2,000 folding phone dubbed Galaxy Fold after a series of breakage issues had been reported. Many tech reviews reported the inside screens flickering, freezing, and ultimately dying on their test phones within the first few days. The reviews revealed as well that substances found inside the device affected the display performance.

Final Frontier in collaboration with Bitfury announced the launch of a fully regulated Bitcoin mining fund, following authorization by a European financial regulator.

Bitfury, which develops blockchain-related software along with providing mining equipment and services, confirmed that Final Frontier had gained regulatory approval for the fund. Final Frontier is a specialist investment firm focused on innovative technologies.

The fund has been conceived with the aim to provide institutional and professional investors convenient access to Bitcoin mining, according to the blog post released on Wednesday.

Access to mining facilities or exposure to mining operations has been riddled withtechnological, logistical, financial and execution risk challenges. With that in mind, the company wants to address those challenges with an offering that has been authorized by a European financial authority.

According to the announcement, the fund will invest in turnkey assets consisting of mining sites across the globe, where electricity and operating costs are low. Bitfury will have a big role to play in exploring opportunities and conducting the operating activity. Bitfury will provide the hardware for the project, which will also leverage the company’s various mining centers to source power and deliver favorable mining costs.

Final Frontier co-founder, Imraan Moola sees this as an opportune time for investors that have an interest in having exposure to cryptocurrency markets, stating:

“With the bitcoin price down significantly from its all-time high, yet institutional interest growing every day, now may be an opportune time to consider investing in bitcoin mining.”

At the same time, Bitfury’s executive George Kikvadze said that the fund will help investors strengthen their portfolios and bring Bitcoin closer to mainstream adoption.

Earlier this year, Bitfury partnered with South Korean R&D firm Commons Foundation to jointly launch a network of Bitcoin mining operations in Paraguay.

Bitfury is also reportedly considering an initial public offering (IPO) in Amsterdam, London or Hong Kong, possibly to be held this year. The firm raised $80 million in November, in a round led by venture capital firm Korelya Capital, with Mike Novogratz’s Galaxy Digital, Macquarie Capital and Dentsu Inc. also participating.